Good Morning,
Happy Monday! It always puts a smile on my face seeing all the bluegill beds this time of year—it's the little things in life.
Markets opened mainly higher this morning, extending a May rally that produced 11 all-time closing highs for the S&P 500. Investors are entering June with two powerful forces pulling in the same direction: persistent enthusiasm around AI and ongoing optimism that a potential U.S.–Iran agreement could reopen the Strait and help keep oil prices contained.
That said, I believe much of the potential upside from an Iran deal has already been priced into the market over the past few trading days, which increases pressure for a deal to materialize sooner rather than later.
Recent consumer spending has remained stable, albeit somewhat uneven. Strength appears to be concentrated within value segments and higher-income cohorts rather than reflecting broad-based acceleration. The continued resilience in consumer spending and ultimately corporate earnings, is encouraging and could strengthen further if a deal is reached and oil prices decline meaningfully.
I will be watching May’s payroll report, scheduled for release this Friday. Labor data has taken on increased importance as investors assess whether investment in AI is generating sufficient growth to offset any broader economic slowdown.
Overall, I remain optimistic about the market backdrop as we head into the summer spending months. As always, please don’t hesitate to reach out with any questions.
Attached is this week’s Market Strategy Radar Screen Report from John Stoltzfus, Chief Investment Strategist at Oppenheimer Asset Management.
Have a great week!